War's Financial Impact in the Temporary Entity

The study issued by the Union Center for Research and Development examines the ongoing costs of the war in the temporary Israeli entity. These costs go beyond mere military expenses to include impacts on public finances, the political crisis, the labor market, and external support networks. The study indicates that the central issue has become how to sustainably finance a consistently high level of defense, given the escalation in defense spending, debt levels, the non-mobilization of Haredim, migration, capital movement, and the influence of the American borders and their confrontation strategies. In addition, potential burden-sharing with Gulf countries and the effects of disturbances in the Hormuz and Bab el-Mandeb straits on energy and trade are also considered. The findings show that ensuring continuous adequate funding requires a reevaluation of policies and the development of permanent solutions for defense financing, amid expectations of increased pressure on the public budget.

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